Congress Holds Hearing on Reauthorization of User Fees

In a hearing of the US Senate Committee on Health, Education, Labor and Pensions held in early April 2017, representatives from the generic drug, biotechnology, and pharmaceutical industries urged Congress to reauthorize user fees, authorized under several pieces of legislation, including the Prescription Drug User Fee Act (PDUFA), the Generic Drug User Fee Amendments (GDUFA), and the Biosimilars User Fee Act (BsUFA) before their pending five-year expiration date in September 2017. Failure to reauthorize these user fee acts would impede new product approvals and likely delay research and development, according to industry representatives.

PDUFA, GDUFA, and BsUFA, passed in 2012, authorize the US Food and Drug Administration (FDA) to collect fees and use them for the review of human drug applications, generic drug applications, and biosimilar drug applications, respectively, but they require Congressional reauthorization every five years.

Industry representations who testified at the recent US Senate Committee on Health, Education, Labor and Pensions included David Gaugh, senior vice president of sciences and regulatory affairs for the Association for Accessible Medicines (AAM, formerly the Generic Pharmaceutical Association) and the Biosimilars Council; Kay Holcombe, senior vice president for science policy at the Biotechnology Innovation Organization (BIO); Scott Whitaker, president and chief executive officer of the Advanced Medical Technology Association; and Cynthia Bens, vice president of public policy for the Alliance for Aging Research.

Mr. Gaugh, who also testified in an earlier hearing last month, reiterated his points that the FDA remains underfunded, which is what prompted the generic drug industry to step up and aid in providing the FDA with additional user-fee resources to address the ongoing challenges caused by an increasingly global drug supply chain.

“Generic manufacturers make complex and highly confidential analysis when selecting which products to pursue. This analysis can include assessing the complexity in reverse engineering, the state of the intellectual property, the size of the market, the likely number of competitors, the product development and manufacturing capabilities and costs. Because of these complexities, AAM believes that the best way to control drug costs generally, is through policies that incentivize competition and Generic Drug User Fee Amendments (GDUFA II) does just that,” Mr. Gaugh stated in his testimony.

The priority of the generic drug industry in the negotiations for a new GDUFA legislation, known as GDUFA II, was to achieve a more effective and transparent generic drug review program. This would improve the rate of first-cycle approvals on the earliest legally eligible date through greater transparency and communication during the review process and promoted greater communication and cooperation between FDA and generic drug sponsors, Mr. Gaugh said.

In her testimony, Ms. Holcombe cited BIO’s support of the reauthorizations of both PDUFA and BsUFA. She noted that PDUFA proved that review times could be reduced significantly through providing user fees to support the additional staff the FDA needs to carry out more quickly the activities related to the review of human drug applications.

“By the end of the five years of [the] first PDUFA program, review times had dropped by as much as three-fold. The successes of PDUFA gave rise to user fee programs to achieve greater efficiency in the review of medical devices, generic drugs and biosimilars,” Ms. Holcombe said.

In the first PDUFA, the FDA issued guidance in 2005 to ensure an efficient and effective first-cycle review process. The FDA said that it plans to update this guidance in PDUFA VI (the reauthorization for PDUFA for fiscal years 2018 through 2022) to include: review activities that have since been added; principles regarding notification to applicants regarding issues identified during the FDA’s initial review of applications; principles regarding the FDA’s notification to applicants regarding planned review timelines; and internal review timelines that govern human drug review that are not part of PDUFA. FDA will publish a revised draft guidance for public comment no later than the end of FY 2018. In addition, the FDA plans to publish revised draft guidance on formal meetings between the FDA and sponsors no later than September 30, 2018.

Modifications of both the PDUFA and BsUFA programs, negotiated by the FDA and the biopharmaceutical industry with support and input from patient, consumer, and healthcare provider organizations and other stakeholders, are designed principally to improve efficiency, reduce administrative burdens, enhance program long-term sustainability, and ensure that modern tools are used to advantage in the review of new drugs and biologics and of biosimilars, Ms. Holcombe stated.

BsUFA II incorporates lessons learned from implementation of the first BsUFA and provides a roadmap to overcome some of the unexpected challenges encountered with BsUFA I. The key provisions in BsUFA II include: the establishment of an independent fee structure based on BsUFA program costs to generate a total of $45 million in revenue for fiscal year 2018; establishing a new application review model similar to that under the Prescription Drug User Fee Act V for new molecular entity new drug applications and original biologics license applications to minimize the number of review cycles necessary for biosimilar approval; and the issuance of six guidances by the FDA for reviewing or taking action on a biosimilar applications.